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Welltower restructures lease agreement with troubled tenant Genesis Healthcare

Welltower Inc. restructured its master lease agreement with tenant Genesis Healthcare Inc. on Jan. 1, reducing the tenant's obligation by $35 million and extending the term by five years.

In November 2017, Genesis said it would consider bankruptcy if its restructuring plans did not work out.

Welltower and Omega Healthcare Investors Inc. also entered into an agreement with Genesis to amend and expand Genesis' existing $120 million term loan agreement. Welltower will fund a $24 million tranche and expects to receive priority repayment.

Genesis on Feb. 2 entered into a $555 million credit facility with MidCap, a unit of alternative asset manager Apollo. The facility comprises a $325 million first lien term loan, a $200 million first lien revolver and a $30 million overline facility. The facilities have five-year terms, and proceeds will go toward repaying and replacing Genesis' existing $525 million revolving credit facilities due February 2020.

Welltower also purchased six independent living communities in Canada, through a 95/5 REIT Investment Diversification and Empowerment Act joint venture with Cogir Management Corp., for C$248 million.

The deal with the Canadian seniors housing operator would add 1,466 units across four communities in Montreal and two in Quebec City to the Ohio-based healthcare real estate investment trust's portfolio.

In its 2017 earnings report, the REIT said it and operating partner New Perspective acquired a 121-unit private-pay seniors housing property in Green Bay, Wis., owned by a third party for $33 million.

An existing 94/6 joint venture between Welltower and Sagora Senior Living paid $10 million for a 38-unit private-pay seniors housing property in Tusla, Okla.

Welltower also bought three off-campus, affiliated outpatient medical buildings, encompassing 109,785 square feet, in Tampa, Fla., for $46 million, which are fully leased to Florida Medical Clinic.

Welltower spent $11 million to purchase a similar 20,577-rentable-square-foot property in Austin, Texas, that is 100% leased to Seton Healthcare, and bought a 130,000-rentable-square-foot off-campus, affiliated, outpatient medical building in New York for $68 million, which is fully occupied by Summit Medical Group.

The company completed the £12 million development of a Gracewall-branded private pay seniors housing property in greater London, in partnership with Sunrise Senior Living and Revera.

Welltower also completed the sale of a long-term acute hospital to Froedtert Health for $31 million. Operator LifeCare Health Partners will remain as the property's sole tenant.

Welltower sold a 187-unit seniors housing property in Vancouver for $76 million to an unnamed developer. Welltower owned a 75% stake in the property, with Rivera owning a 25% stake. The buyer agreed to construct a 190,000-square-foot seniors housing property within the site for the JV.